The Budget Law 2025, recently approved by the Italian Parliament, presents a number of measures that could significantly transform the tax and labour landscape for companies. In a certain way, public institutions encourage better conditions for credits and taxes to companies. 

Employment incentives 

The first reform is a tax incentive designed to stimulate hiring, extended for the next three years. Companies and professionals will be able to reduce an additional 20% of the labour costs derived from the incorporation of new workers with permanent contracts. In specific cases, such as the hiring of disabled people, young people under the age of 30, mothers with at least two children, women who are victims of violence or former beneficiaries of the citizenship income, this deduction may reach up to 130%. In addition, the reduction in the substitute tax, from 10% to 5%, applicable to productivity bonuses is extended until 2027. 

Reduction of corporate income tax (IRES) 

One of the most important tax incentives is the reduction of the IRES from 24% to 20% for companies that reinvest at least 80% of their profits and increase their workforce by 1%. An important detail is that at least 30% of these investments must be allocated to 4.0 and 5.0 assets. 

Boosting investment 

In order to stimulate economic development in southern Italy, 1.6 billion euros are allocated to a tax credit aimed at the acquisition of capital goods in this region. In parallel, the resources of the ‘Nuova Sabatini’ programme, aimed at reducing financing costs for the purchase of machinery, are increased and incentives for investment in the tourism sector are reinforced. 

Facilitating listing on regulated markets 

Small and medium-sized enterprises (SMEs) seeking to list on regulated markets or multilateral trading facilities in Europe will see the extension of a 50% tax credit on the consultancy costs associated with this process until 2028.

It is becoming increasingly common for states to encourage job creation through tax incentives for those companies that meet the requirements. For this reason, Auxadi offers payroll management for your subsidiaries in Italy or in any of the more than 50 countries covered. 

Can Auxadi help?

Auxadi can become your ideal partner. We offer a one stop shop value added outsourcing services in the areas of accounting and reporting, tax compliance, payroll management and representation services, among others.

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Founded in 1979, Auxadi is a family-owned business working for multinational corporations, private equity funds and real estate funds. It’s the leading firm in international accounting, tax compliance and payroll services management connecting Europe and the Americas with the rest of the world, offering services in 50 countries. Its client list includes many of the top 100 PERE companies. Headquartered in Madrid, with offices in US and further 22 international subsidiaries, Auxadi serves 1,500+ SPVs across 50 jurisdictions.

All information contained in this publication is up to date on 2024. This content has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this chart without obtaining specific professional advice.No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this content, and, to the extent permitted by law, AUXADI does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this chart or for any decision based on it.